Viewpoint -- Doha Is Not Dead -- Nor Is The WTO

Agreement is possible if 149 nations will refresh their memories, set a workable agenda and abandon the 'Me' generation.

Doha is dead.

The WTO is dead.

Such pronouncements are being heard in the wake of the suspension last month of the Doha Round of international trade negotiations.

Named for the capital of Qatar, the Middle Eastern nation where they were begun in November 2001, the talks involved 149 nations and were being held under the auspices of the Geneva, Switzerland-based World Trade Organization (WTO). The intended agenda was remarkably ambitious, involving not only the lowering of barriers to trade in manufactured goods, but also tackling the tough issues of investment and intellectual property protection, and most especially the highly-charged issues of agricultural subsidies and agricultural tariffs. Notably, the U.S. and Europe planted themselves in widely separated fields and refused to find common ground, even as the globe's economically developed countries and the world's developing nations staked out dramatically opposed positions on market access and would not yield.

Death notices for Doha and the WTO, however, are premature.

The economic world of today is itself far different from the world into which the General Agreement of Tariffs and Trade (GATT), the WTO's predecessor organization, was born in the years just after World War II. Trade in goods and services is now several times what it was then -- global trade and investment are now measured in the trillions of U.S. dollars -- and trade is more sophisticated and arguably more important to far more nations' economic standing in the world. It can be said that if a WTO did not now exist, a WTO would have to be created to help discipline trade in an increasingly competitive and economically interdependent world.

This is not to ignore the increasing number of bilateral free-trade agreements that have been negotiated both before and during the Doha Round of multilateral trade talks. They are doing much to lower tariffs, to lower non-tariff barriers to trade and to raise economic prospects, especially those of developing countries.

But the bilateral nature of two-nation free-trade agreements is both a strength and a shortcoming. Bilateral negotiations involve just two nations, not 149. The negotiations are focused on a few issues. Implementation often can follow swiftly after agreement. What's more, bilateral negotiations can be the blocks with which multilateral negotiations are built.

But bilateral agreements are not multilateral agreements. They are limited in their scope and simply can't embrace tariffs, non-tariff barriers, and investment and intellectual property issues on a global scale. Something like the WTO would have to be created if only to catalog all the bilateral agreements now in place around the world.

Meanwhile, what has been particularly striking about the now-suspended Doha Round of WTO talks is the rigidity of the positions that nations, including the U.S., have taken. So many of these countries have approached the Doha Round as members of a very selfish "Me" generation, a generation which does not really believe in negotiations but demands that others give me what I want. Free and fair trade in this context loses any international characteristics; trade must be free and fair for me. Others must look after their interests; I'm interested only in my interests.

No sophisticated trading nation goes into trade talks on a WTO scale putting its final position first. A nation works with others to set an agenda and then bargains the possible. However, the 149 nations of the WTO have done a remarkable and regrettable job of forgetting why they have been meeting in the first place. It's time for them to refresh their memories.

It's time for the 149 nations of the WTO to identify anew the most important trade issues that they collectively face. Their goal should be not to create an ambitious agenda but a workable agenda. It's time for the 149 nations of the WTO to think about what failure of the Doha Round would mean not only to their individual countries but also to the world of trade and investment generally. It's time for the 149 nations of the WTO to be very specific with their businesses and most especially their general publics what the benefits and costs of additional trade liberalization are likely to be. Ultimate approval of any trade agreement more than ever before depends upon informed consent for the talks at their outset.

A conclusion of a renewed Doha Round is highly unlikely to come this year. And it may not come in 2007. It may not come until there are new presidents in France and the United States and a new prime minister in the UK. The year is not as important as workable results which have widespread support.

There is still time for a successful Doha Round.

John McClenahen is an IndustryWeek senior editor. He is based in Washington, D.C.

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